TRANSFORMATION the Key to the future Portfolio Committee on NUM Presentation 20th August 2014 Portfolio Committee on Mineral Resources TSHIMANE MONTOEDI

Transformation Status in the Mining MPRDA 2002 Social and Labour Plan Broad Based Socio-Economic Empowerment Charter for the South African Mining and Minerals Industry

Social and Labour Plan Implementation The mining industry has the necessary legislative frameworks to achieve greater transformation and ensure the development of its employees, mine host communities and labour sending areas. The biggest impediment to achieving the above mentioned objectives, is the industry’s lack of commitment towards transformation. The captains of industry need to spearhead this process with executive decisions, backed by the necessary financial support

The mining industry has a collective responsibility to ensure that mining companies comply with the Mining Charter, the MPRDA 2002, Skills Development Act, Social and Labour Plans. SLP implementation should result in skills development for employees, developed mine host communities, mining operations significantly contributing to local economic development through procurement and enterprise development, etc.

Challenges with SLP Implementation There is no direct link between the Mine Works Programme, SLP commitments and IDP’s Non compliance is not linked to heavy penalties (Section 93 not always followed by Sec 47) Lack of Coordinated Monitoring and Evaluation Programme (as per the stakeholder declaration) Section 101 not adhered in the appointment of contractors

Human Resource Development Updated Form Q that determines employees educational needs Full implementation of Employee and Community ABET program Eradicating Barriers linked to ABET, these include loss of bonuses and salaries for employee’s who attend such programmes Mining Companies should stop relying on MQA grants in order to implement skills development initiatives Learnerships & Bursaries should be utilised to empower workers and create community talent pool

Local Economic Development Stakeholder involvement in the implementation process Compulsory Host Community and Labour Sending Areas Socio Economic Survey should be conducted in order to understand their needs Mining Companies project managing all LED projects to ensure sustainability of the project This section should be linked to both Local and District Municipalities Integrated Development Plans

Housing and Living Conditions Conversion of all hostels into single and family units as per the charter targets (this must include all contractor employees) Mining Companies should not only facilitate, but provide employees with houses as benefits of the minerals they mine. Mining Companies should ensure all new developments house prices are affordable for mine workers. Housing Policies should allow employees to own houses in Labour Sending Areas and Villages

Downscaling and Retrenchments All mining right holders must have compulsory monthly SLP forums with Labour Represented and quarterly Future Forums with other stakeholders represented. The industry should implement Section 52 and Regulation 46 (e) before LRA’s Section 189. Companies should cut management salaries and bonuses as an initiative to avoid Job losses. DMR Regional Offices should be actively involved in the approval or rejection of all downscaling processes.

Mining Charter Assessment Challenges No significant change on the ownership of mines (most transactions are economically meaning less and over burdened with debt) No evidence of direct link between proposed and implemented community development projects Insignificant number of HDSA at decision making positions Lack of sufficient investment in HDSA skills development Lack of strategy for procurement and enterprise development

Ownership Achieve a minimum of 26% HDSA ownership by 2014 (including ESOPS) 10% Should be owned by Employees 10% Should be owned by host communities This ownership should translate to executive decision making The funding for these initiatives should not be linked to debt It should also enjoy the equal shareholder benefits, including dividends and participating in AGM’s or board meetings. Ooooooooo

Beneficiation Coordination between DMR, DTI and Economic Development Departments (on the implementation0f the Beneficiation Strategy) The Beneficiation strategy should outline both upstream and downstream beneficiation strategies The strategy should be linked to the Skills Development Accord with specific focus on how SETA’s can ensure alignment with the required skills Establishment of a Mineral Beneficiation Committee

Procurement Developing an industry wide strategy for local procurement and enterprise/SMME development The regulator’s monitoring and evaluation process should include forensic audits of company financial statements and submitted reports Established Suppliers must form mandatory Joint Venture partnerships with local suppliers Enterprise Development should be accompanied with the relevant support

Employment Equity Industry should eradicate the “Irish Coffee Syndrome” Income disparities should be addressed (especially if race and gender is the only differentiator between two employees) HDSA’s in Management should have executive authority HDSA’s should represent the country’s population demographics, currently the biggest benefactor of this policy are white women

Mine Community Development Host communities and labour sending areas should benefit from the mineral wealth of this country The Community is a critical stakeholder in the mining industry, hence it’s imperative for companies to include them in their HRD programme (ABET, Learnerships, etc.) Enterprise Development with the relevant business support Preferential Procurement Policies should specifically target the Economic Development of host communities

Way Forward An integrated approach is required to monitoring and evaluation of implementation (Reporting) Enforce punitive measures for Non-compliance, the current draft amendment bill should provide for this Redefine HDSA (exclude white women, reflect racial demographics of the country) Include people living with disabilities in the charter

THANK YOU!!!